More SUVs, please

Keith MagillExecutive Editor

Sunday

Dec 21, 2008 at 12:01 AM

President Bush has stepped in where Congress wouldn’t and put up $17.4 billion the federal government doesn’t have to bail out the financially ailing Big 3 automakers.I’m not sure whether it is the right way to do it, but I agree with Bush and others who believe America cannot afford to let the American car companies go out of business.It is odd, however, to see a president who has called himself conservative betray those values by injecting the federal government into the free-enterprise system instead of letting capitalism take its course without interference from Washington. But, as we have seen many times, talking like a conservative – or liberal or anything else, for that matter – is a different than acting like one.It’s also distressing to see the CEO of the biggest bankrupt institution on the planet – the U.S. government, with a $10.6 trillion debt that grows by $3.6 billion a day – offer loans to the Big 3 in hopes of sparing them the same fate. How is that possible? Well, Bush and the federal government have at least two tools most financial institutions don’t: the ability to print money and the power to tax their citizens to repay debt.So a few weeks after our $700 billion bank bailout, U.S. taxpayers are locked into backing $17.4 billion in loans to three companies in such dire straits that without the money, they will go bankrupt.And as one of the taxpayers with cash on the line here, I’m less than enamored with the terms Bush outlined for the deal Saturday in his radio address.“The terms of the loans will require the auto companies to demonstrate how they would become viable,” he told the American people. “They must pay back all their loans to the government and show that their firms can earn a profit and achieve a positive net worth.“This restructuring will require meaningful concessions from all involved in the auto industry -- management, labor unions, creditors, bondholders, dealers and suppliers. If a company fails to come up with a viable plan by March 31, it will be required to repay its federal loans. Taken together, these conditions send a clear message to everyone involved in American automakers: The time to make the hard decisions to become viable is now -- or the only option will be bankruptcy.”OK, let me get this straight. We’re asking three companies that say they need billions of dollars to stay afloat to come up with a plan in four months that would reverse their downward spiral toward bankruptcy. In four months, the geniuses who flew their corporate jets to Washington to beg for a bailout are supposed to devise a plan that will reverse years of inertia, bad planning, unsustainable deals with labor unions, excessive CEO compensation and other bad practices and present a blueprint to not only compete with the foreign companies that have stolen major market share from them over three or four decades but to become “viable” businesses once again.Would you bet your hard-earned money on their success?Well, thanks to President George W. Bush, you just did.And why not?How many Americans bought into the shortsighted mirage our federal government, in cahoots with the automakers, perpetrated over the past decade or so?Who bought those SUVs and monster trucks and minivans, anyway? Isn’t it the slight bit hypocritical to complain about gas prices as they exceeded $4 a gallon a few months ago while riding around in one of those gas-guzzlers?Ever call your congressman or senator and tell him or her to boost fuel-efficiency standards and take other steps that might decrease our dependence on foreign oil – which now accounts for nearly 67 percent of all the crude we consume? Have we really insisted that our elected leaders do something to seriously begin the transition from oil to other, perhaps more sustainable and affordable, forms of energy? Have we done anything significant ourselves, through what we buy or consume, to encourage that trend?Heck, no. It’s easier to blame the greedy oil companies, the Middle Eastern sheiks, the overpaid car-company CEOs, the inept government, the special interests, the lobbyists, the Wall Street speculators and the assorted other scapegoats than it is to accept any complicity in this mess or any responsibility to help correct it.Even when gas prices skyrocketed, I didn’t see any fewer SUVs or super-tough trucks on the road, in our local high-school parking lots or at the gas pumps.Yes, in America, we have a right to drive whatever car or truck or SUV we desire to wherever we want whenever we please. If we can afford a monster truck – even if it takes borrowing beyond our means – we deserve it. We’re entitled.Maybe so. I just wish more people would stop complaining about the consequences.

Courier Executive Editor Keith Magill can be reached at 857-2201 or keith.magill@houmatoday.com.

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